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Thursday, Mar 28, 2024

21st Century Plans Layoffs At Woodland Hills Offices

At least 93 people will be fired in coming months from the Woodland Hills insurer 21st Century Insurance Group. The company plans to cut 110 workers, 85 percent of which will be information technology employees and managers in the Woodland Hills headquarters, said company spokesman Larry Krutchik. The layoffs represent about 4 percent of the company’s total workforce. The company will also cut information technology contractors from 300 to 20 through the spring. The insurer blamed the cuts on lower fourth quarter profits, an aggressive growth plan and some compensation expenses. Fourth quarter earnings fell to $19.2 million or $0.22 per diluted share from $26.4 million, or $0.31 a share from the same 2005 period. Earnings had been expected to tally about $0.28 a share. The company, however, did report a slight upturn in direct premiums, which increased 1.9 percent to $323 million for the quarter. In a statement, Senior Vice President and Chief Financial Officer Steven P. Erwin said this year is a rebuilding period. “2005 and 2006 were periods of implementation of new systems and new markets. Now that we have achieved a national capability, we are committed to reducing our expense ratio through expense management, quality of operations and growth in premiums,” he said. President and CEO Bruce W. Marlow furthered the point in a call to investors, using a nautical theme. “The people you have and the way you spend your money when you’re building a ship are very different from when you’re sailing a ship,” he said. “We’re now sailing the ship.” The repositioning comes two months after New York City insurance giant American International Group Inc. offered to buy the company for $690 million. AIG already owns 62 percent of 21st and offered $19.75 per share for the rest. 21st formed a committee to look into an acquisition, although no deal has been announced, the company said. “We all must allow the special committee to do the job,” Marlow said. Dreamworks Returns ‘Flush’ Glendale-based DreamWorks Animation SKG Inc. confirmed expectations that poor returns from its box office bomb “Flushed Away” would impinge on the studio’s bottom line. The film released last fall cost the studio a total of $190 million, according to financial returns. That loss sent DreamWorks’ net income dropping from $63.2 million, or $0.61 per diluted share, in fourth quarter 2005 to a net loss of $21.3 million, or $0.20 per share, a year later. The one bright spot was revenue growth an increase from $173 million last year to $204.3 million fueled by Dreamworks’ successful “Over the Hedge” becoming available on DVD and video. Those sales alone contributed to half of the company’s fourth quarter revenue but was offset by the sheer cost of the sales coupled with the write-off, which totaled $219.9 million. In a conference call after the results were released, CEO Jeffrey Katzenberg acknowledged the mixed returns but pointed to high hopes for the studio’s next film, “Shrek the Third,” due out in May. “While both of our overall home video performance and the theatrical success of ‘Over The Hedge’ were positive this year, our second release, ‘Flushed Away,’ did not live up to our expectations,” he said. U-Wink Concept Holding Well It appears uWink Inc., the entertainment-restaurant concept featuring touch-screen tabletop computers for ordering and playing games, has caught on. The Van Nuys-based company reported attendance at its pilot Westfield Promenade location in Woodland Hills is steadily increasing, averaging 3,500 a week and more than 60,000 games played. That has sent revenue steadily growing month-to-month, from $30,000 in October to $185,000 in January. “We expect to continue our revenue growth as we layer in additional capacity and software designed to creative activities that will add revenues streams and fill the restaurant during traditionally slow times,” said company founder and CEO Nolan Bushnell in a letter to shareholders. Earlier this year, the company installed 28 more seats at the restaurant in response to long weekend wait times. Bushnell is also the creator of Atari and Chuck E. Cheese’s. Briefly Glendale-based PS Business Parks Inc. has bought a Washington business park. The company paid $76 million for the 493,000-square-foot Overlake Business Center in Redmond, Wash. The 27-structure complex has 161 tenants. The company now owns 19 million square feet of office space in nine states. ValueClick Inc. reported stronger-than-expected fourth quarter profits, tallying a net income of $22.1 million or $0.22 per diluted share and 56 percent higher than the same 2005 period. The Westlake Village company pointed to new online advertising such as its much-touted video ads for the increased profit. Staff Reporter Chris Coates can be reached at (818) 316-3124 or at [email protected] .

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